Market Size of India Real Time Payments Industry
Study Period | 2019 - 2029 |
Base Year For Estimation | 2023 |
Forecast Data Period | 2024 - 2029 |
Historical Data Period | 2019 - 2022 |
CAGR | 33.50 % |
Market Concentration | Medium |
Major Players*Disclaimer: Major Players sorted in no particular order |
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India Real-Time Payments Market Analysis
India's real-time payments market is expected to register a CAGR of 33.5% during the forecast period (2022 - 2027). Real-time payments typically focus on low-value retail payment systems (RPS); they differ from real-time gross settlement systems (RTGS) and distributed ledger payment systems. In addition to meeting the demands and expectations, real-time payments have generated interest from the regulators, competition authorities, and payment service providers. Regulators believe that instant payments will expand access to banking services, support economic growth, provide alternatives to Visa/Mastercard networks and reduce the use of cash and cheques.
- India has made tremendous growth when it comes to access to Internet-enabled devices in the country. For instance, the government's plan to fiberize all villages by 2025 under the BharatNet program has benefitted the banking sector in India, which has been able to make crucial changes in banking mechanisms by introducing digital means of accessing financial services through mobile phones. With instant payment systems, top banks in India have launched not just intuitive but also innovative and interactive mobile banking applications with features revolving around customer satisfaction.
- The decade of 2010-2020 can be termed as the decade of payment evolution in India. India has been transforming its payment systems over the past three decades. From barter systems to Unified Payments Interface (UPI) payment systems, India has come a long way primarily because of the failing resilience of traditional banking and the rise of Real-time Payment systems through digital transformation.
- India's central bank (RBI) plays a key role and has been supervising all these transformations. For Instance, in March 2022, RBI rolled out a digital-heavy plan for 2022-23. The central bank announced lending norms for digital platforms, rolled out a central bank digital currency, facilitated the setting up of 75 digital banks, and implemented a geo-tagging framework for POS terminals. It has proposed several measures to bring about structural reforms in the digital payments and fintech space, which has positively influenced the real time payments growth in the country.
- India has worked around its policies towards the introduction of innovative payment systems that provide instant credit to the beneficiary, with the launch of fast payment systems such as IMPS and UPI that are available to consumers round the clock for undertaking fund transfers and the introduction of mobile-based payment systems such as Bharat Bill Payment System (BBPS), PPIs to facilitate payment of bills and purchase of goods and services and National Electronic Toll Collection (NETC) to facilitate electronic toll payments.
- The convenience of these payment systems ensured rapid acceptance as they provided consumers with an alternative to using cash and paper for making payments. The facilitation of non-bank FinTech firms in the payment ecosystem as PPI issuers, BBPOUs, and third-party application providers in the UPI platform has furthered the adoption of digital payments in the country.
- The Covid-19 pandemic has had a mixed impact on the real-time payment system in India. The e-wallets saw increased traction for bill payments, P2P transfers, and P2B payments for essential services owing to the lockdown. Payment gateways saw an increase in volumes as transactions went online, tieing up with small stores selling essentials that are currently seeking to establish an online presence.
- Online frauds, including database exploits, ID thefts, phishing attacks, and card payment-related scams, are common in India, and the number has only increased during the pandemic. As per Microsoft's Global Tech Support Scam Research 2021 Report, consumers in India experienced a fairly high online fraud. 31% of Indians lost money through a scam making it the highest global encounter rate of 69% in the past year. Low internet bandwidth E-commerce entails a set of complex steps while completing a transaction, and even a minor glitch can terminate the task.
India Real-Time Payments Industry Segmentation
The Indian Real-Time Payments Market is Segmented by Mode of Payment (Person-to-Person (P2P) and Person-to-Business (P2B)). Real-time payment is a fully electronic payment system in which irrevocable funds are transferred from the remitter and credited to the beneficiary, where confirmation back to the originator and receiver of the payment is available in one minute or less.
Banks interested in connecting to the RTP network typically work with a technology provider with a streamlined process that enables them to do so. For example, providers such as PayPal India, PayUmoney, Paytm, CCAvenue, Razorpay, Instamojo, Cashfree, HDFC PayZapp, BHIM Axis Pay, SBI Pay, and many more are currently providing real-time payment transfer services in the country.
By Type of Payment | |
P2P | |
P2B |
India Real Time Payments Market Size Summary
The real-time payments market in India is experiencing significant growth, driven by the increasing adoption of digital payment systems and the widespread availability of internet-enabled devices. The country's shift from traditional banking methods to innovative payment solutions like the Unified Payments Interface (UPI) and Immediate Payment Service (IMPS) has been pivotal in this transformation. These systems offer instant credit and facilitate round-the-clock fund transfers, reducing reliance on cash and cheques. The Reserve Bank of India (RBI) plays a crucial role in this evolution, implementing policies and infrastructure developments to support digital payments, such as the Payments Infrastructure Development Fund and the introduction of a central bank digital currency. The National Payments Corporation of India (NPCI) has also been instrumental in rolling out various payment products, enhancing the accessibility and efficiency of real-time transactions across the country.
The COVID-19 pandemic has further accelerated the adoption of real-time payment systems, as consumers increasingly turned to digital solutions for transactions. Despite challenges like online fraud and low internet bandwidth, the market has seen a surge in the use of e-wallets and payment gateways. The introduction of services like UPI Lite and advancements in contactless technology have contributed to the market's expansion. India's real-time payment ecosystem is also becoming more inclusive, with partnerships and collaborations enhancing its global reach. The market's growth potential has attracted significant investments, leading to increased fragmentation and competition among service providers. As consumer preferences evolve, companies are focusing on product innovation and strategic partnerships to capture a larger market share, positioning India as a leader in the global real-time payment landscape.
India Real Time Payments Market Size - Table of Contents
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1. MARKET INSIGHTS
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1.1 Market Overview
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1.2 Industry Attractiveness-Porter's Five Forces Analysis
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1.2.1 Bargaining Power of Suppliers
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1.2.2 Bargaining Power of Buyers/Consumers
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1.2.3 Threat of New Entrants
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1.2.4 Threat of Substitute Products
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1.2.5 Intensity of Competitive Rivalry
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1.3 Evolution of the payments landscape in the country
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1.4 Key market trends pertaining to the growth of cashless transaction in the country
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1.5 Impact of COVID-19 on the payments market in the country
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2. MARKET SEGMENTATION
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2.1 By Type of Payment
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2.1.1 P2P
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2.1.2 P2B
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India Real Time Payments Market Size FAQs
What is the current India Real Time Payments Market size?
The India Real Time Payments Market is projected to register a CAGR of 33.5% during the forecast period (2024-2029)
Who are the key players in India Real Time Payments Market?
Phone Pe, Google LLc (Alphabet Inc.), NPCI, Paytm and PayPal Payments Private Limited are the major companies operating in the India Real Time Payments Market.